Intermodal Freight: What it Means, How it Works

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What It Is: Movement of sealed containers across two or more transport modes (truck, rail, ship) without unloading between transfers.
How It Works: First‑mile drayage by truck to a rail/port, long‑haul by rail or sea, then last‑mile trucking—using the same ISO container end‑to‑end.
Cost Savings: Shifts long‑haul segments to more fuel‑efficient rail or sea, cutting per‑mile fuel and labor expenses.
Damage & Theft Reduction: Sealed containers minimize handling, reducing damage risk and cargo loss—rail yards also offer tighter security.
Predictable Transit: Fixed rail and vessel schedules offer more reliable delivery windows compared to over‑the‑road trucking.
Eco‑Friendly: Rail emits up to 83% less CO₂ per ton‑mile than trucks; ocean freight cuts emissions roughly 15–25× versus air.
Scalability & Flexibility: Ability to handle high volumes (double‑stack trains, 20K+ containers per ship) and reroute around disruptions for continuous flow.

Intermodal freight shipping is a growing part of the logistics space, with its market value reaching $42.5 billion in 2022 and projected to climb to $109.5 billion by 2032, an increase of over 157%.

But why is intermodal freight gaining so much attention, and what does it mean for freight brokers?

This article will explain intermodal freight, how it works, and why it’s becoming a valuable tool in modern logistics. You’ll learn about the benefits, challenges, and opportunities it creates for brokers to serve clients better.

What Is Intermodal Freight?

Intermodal freight is the movement of goods using two or more modes of transportation, while the cargo remains sealed in the same shipping container throughout the journey. This cargo transport method eliminates the need to unload and reload cargo when switching modes.

For example, a shipment might start its journey on a truck, then be transferred to a train for long-distance travel, and finally be returned to a truck for final delivery. Throughout the process, the goods stay inside the same container, which reduces cargo handling, minimizes damage, and speeds up transfer times.

Container Types for Intermodal Freight

The standard container used for the majority of shipping in North America (by truck or rail) is a 53-foot domestic container, while ocean imports typically arrive in 20-foot or 40-foot ISO containers that may be transloaded into 53-foot containers for inland rail in order to maximize space.

COFC vs TOFC and Why Double-Stack Matters

When cargo is moved by rail, it’s loaded onto a train flatcar in two main ways, those methods being:

COFC (Container on Flatcar): This is when the shipping container itself is lifted off a truck chassis and placed directly onto a specialized railcar, often referred to as a “well car”.
TOFC (Trailer on Flatcar): Sometimes called a “piggyback”, this is when the entire truck trailer, including its wheels and chassis, is driven onto a flat railcar.

Most modern rail services in North America use the COFC method with special double-stack well cars. Double-stacking dramatically increases the train’s carrying capacity and makes shipping much cheaper per container, proving to be a highly efficient method when it comes to moving large volumes of goods.

How Does Intermodal Shipping Work?

Intermodal shipping combines different transport methods to move freight smoothly and cost-effectively. Here’s a clear breakdown of the process, showing how providers coordinate multiple modes to deliver goods.

1. Cargo is loaded into a container

The journey begins when freight is packed into a standardized shipping container at the shipper’s warehouse or production facility. These transport containers are built to fit across different transport types without repacking.

2. Initial movement by truck

A domestic intermodal shipping journey usually starts with intermodal trucking. A drayage carrier picks up the container and hauls it to a nearby rail terminal, rail ramp, or port. This is often called the “first mile” of an intermodal load.

3. Transfer to rail or ship

The container is lifted from the truck onto a train or a container ship at an intermodal facility. No unloading is needed. The entire intermodal load stays inside the sealed container.

This smooth transfer between modes keeps the freight secure, reduces handling time, and helps maintain efficient movement across long distances.

4. Long-haul by rail or sea

The long-haul portion of the trip takes place by rail or sea, both of which offer better fuel efficiency than long-distance trucking.

During this phase, the freight covers thousands of miles with minimal disruption and fewer delays than trucks or air transportation options.

5. Final delivery by truck

Once the container arrives at its destination, it is unloaded from the train or ship and transferred back onto a truck for final delivery to the customer or distribution center. This “last mile” completes the intermodal trucking leg of the journey.

Benefits of Intermodal Freight

Intermodal transport plays a key role in logistics, with 95% of manufactured goods relying on it at some stage before delivery. Let’s explore its advantages to understand why this shipping method is widely used in global supply chains.

Reduced transportation costs

One of the main advantages of intermodal freight is its cost-effectiveness. Long-haul trucking can be expensive due to fuel costs, driver wages, and equipment maintenance.

Shippers and brokers can lower transportation costs by shifting the long-distance portion of a shipment to rail or sea, which are more fuel-efficient. For example, rail transport can move one ton of freight over 470 miles using just one gallon of fuel. In contrast, trucks can move that same load only about 134 miles per gallon of fuel.

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Reduced risk of damage

Since intermodal containers remain sealed from origin to destination, there is little to no cargo handling between the different stages of the journey. This is a major difference from traditional methods, where goods are unloaded and reloaded multiple times. Each transfer is an opportunity for items to be lost or damaged.

Greater containerized cargo security

With freight containers sealed and locked throughout transit, intermodal shipping significantly lowers the risk of theft or tampering. Rail yards and intermodal terminals also have tighter security than roadside stops or truck rest areas, offering another layer of protection.

Over the years, Class 1 railroads have reported about a 75% drop in cargo loss, highlighting the security advantages of rail intermodal.

Reliable and predictable transit times

Railroads and ships operate on fixed schedules, making them less vulnerable to traffic congestion and driver availability issues that impact over-the-road shipping.

While not always the fastest, intermodal services are more predictable, allowing brokers and clients to plan around known transit windows.

Environmentally friendly

Intermodal freight is one of the most sustainable shipping options available today. By shifting the long-haul portion of a shipment to rail or sea, companies can significantly reduce fuel use and greenhouse gas emissions.

Rail transport produces up to 83% fewer CO₂ emissions per ton-mile than trucks. In fact, trains emit around 5 pounds of CO₂ per 100 miles, while trucks release around 20 pounds over the same distance. Also, freight moved by rail instead of trucks can cut greenhouse gas emissions by about 75%.

Sea freight also outperforms air freight in terms of emissions, generating roughly 15 to 25 times fewer CO₂ emissions per kilogram-kilometer.

Increased capacity and scalability

During peak shipping seasons or when trucking capacity is limited, intermodal provides an alternative that helps avoid bottlenecks. Rail networks, in particular, can handle higher freight volumes over long distances with fewer disruptions.

A single rail car can carry three to four times more load than a typical truck. This is possible because many rail cars are designed to hold double-stacked containers, allowing two standardized containers to be loaded on top of each other.

This means an entire freight train can replace more than 300 trucks. On the ocean side, modern cargo ships can move over 20,000 standard 20-foot containers in a single voyage, making them one of the most efficient ways to handle global shipping at scale.

Flexible routing options

Combining various transportation solutions gives logistics providers greater control over the delivery process. They can design more cost-effective routes with a smaller carbon footprint.

This flexibility is especially valuable when traditional routes are disrupted by highway congestion, bad weather, etc. For example, if issues arise on the road, intermodal infrastructure allows you to switch to rail transportation quickly.

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Common Intermodal Accessorials

Understanding common extra charges that you might encounter in intermodal shipping will help you prevent costly surprises and manage your budget effectively. It’s important to note that some extra fees are unique to ramps and equipment. Refer to the table below for a quick guide to understanding various accessorial charges.

Fee	What triggers it	How to avoid it
Demurrage	Your container sits at the rail yard or port terminal for too long (past the allowed free time)	Pre‑book drayage, track availability time, and schedule pickup quickly
Detention	The container is kept off‑terminal beyond free time	Pre‑stage labor and dock, so you can load or unload on time
Per diem	Box or chassis is not returned on time to the pool or line	Plan returns, confirm return location early
Storage	Yard or ramp storage beyond free time	Pick up the container before free time runs out
Chassis split	The terminal has to physically move a container from one type of chassis to another to meet specific requirements.	Verify where the equipment is located beforehand to combine the trips, or use a location where they are both available together.
Flip fee	The box or chassis is not returned on time to the pool or line	Double-check that your trucking company has the correct type of chassis needed before you arrive at the terminal gate.

FAQs

1. What are the challenges of intermodal shipments?

Intermodal freight can face delays at transfer points, limited infrastructure in some areas, and coordination issues between the logistics companies responsible for the different intermodal options.

It also requires access to intermodal terminals and proper equipment for handling the containers.

2. What’s the difference between intermodal freight shipping, multimodal transportation, and transloading?

The differences are that:

Intermodal uses two or more modes of transport with the same container throughout the journey.
Multimodal also uses multiple modes but may involve repacking goods between them.
Transloading means unloading cargo from one container or trailer and loading it into another during the transfer.

3. What are ISO containers?

ISO containers are standardized shipping containers that meet specifications set by the International Organization for Standardization (ISO). These standards ensure the containers are uniform in size, structure, and strength, making them compatible across multiple modes of transport.

ISO containers are typically 20 or 40 feet long and can carry a wide range of cargo. Since they are built to global standards, they can be easily transferred between intermodal facilities.

4. What types of equipment are used in intermodal transportation?

Equipment includes:

Shipping containers for holding and protecting freight throughout the journey across trucks, trains, and ships without unloading the cargo.
Chassis for mounting containers onto trucks so they can be hauled to and from ports, rail terminals, or warehouses.
Container cranes for lifting containers on and off ships at ports or moving them between railcars and trucks.
Reach stackers for handling and stacking containers in intermodal terminals.

Final Thoughts

Intermodal shipping is a smarter and more efficient way to move goods. It helps reduce costs, improve delivery times, and adds flexibility to the supply chain, making it an important strategy in today’s logistics industry.

For freight brokers, understanding how intermodal freight works can open the door to new business opportunities and stronger client relationships.

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